Your Directors have pleasure in presenting their 61^st Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2023.

1. Financial highlights of the Company

2. Dividend:

Your Directors are happy to recommend a dividend @ 500%, i.e. ' 10/- per Equity Share (Face value of ' 2/-each) on 39,84,77,530 shares (Previous Year - 125%, i.e. ' 2.50 per share on 39,84,77,530 Equity Shares of ' 2/- each) for the financial year ended 31^st March, 2023. The net outgo on account of Dividend shall be ' 398.48 Crores. The Dividend shall be paid to those members, whose names shall appear on the Register of Members of the Company on the Book Closure Date i.e. on 08/09/2023.

3. Brief description of the Company's working during the year/ State of Company's affairs:

Your directors wish to report that your Company has achieved turnover of ' 11,298 Crores for the year ended 31^st March 2023 as against ' 8,998 Crores (FY 21-22) on Standalone basis, which is higher by ' 2300 Crores when compared to previous Financial Year.

Similarly, for the year under review (FY 22-23), Profit Before Tax (PBT) was ' 1568 Crores and Net Profit (Profit After Tax) was ' 1293 Crores as against PBT of ' 1305 Crores and Net Profit of ' 891 Crores for the previous Financial Year.

4. Material changes and commitments:

The Company has not made any material changes or commitments which affect the financial position of the Company during the financial year of the Company to which the financial statements relate and as on the date of signing of this report.

5. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future:

There are no such orders except those which have been appropriately challenged before the judiciary and no impact on going concern status and Company's operation in future of such matters are expected or visualized at the current stage at which they are.

6. Details in respect of adequacy of internal financial controls with reference to the Financial Statements:

Your Company has an internal Control System which commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function lies with the Audit Committee of Directors. The Audit Committee monitors and evaluates the efficacy and adequacy of internal control systems, accounting procedures and policies. Based on the report of Internal Auditors, significant audit observations and actions taken on such observations are presented to the Audit Committee of the Board.

7. Details of Subsidiary/Joint Ventures/Associate Companies:

During the year under review, Companies listed below are the Subsidiary Company or Associate Companies:

The Company does not have any material subsidiary in terms of Company's Act, 2013 read with SEBI (Listing Obligation & Disclosure Requirement) Regulations.

*GSFC Agrotech Limited was incorporated on 02/04/2012 as a wholly owned subsidiary company of Gujarat State Fertilizers & Chemicals Limited.A report on the performance and financial position of each of the subsidiaries, associates and joint venture companies as per the Companies Act, 2013 is provided at Annexure - A to the Consolidated Financial Statement and hence not reproduced here for the sake of brevity.

**Gujarat Port and Logistics Company Limited was incorporated on 03/02/2020 as a Joint Venture Company by Gujarat State Fertilizers & Chemicals Limited and Gujarat Maritime Board with proposed investment in the ratio of 60:40 respectively. A report on the performance and financial position of each of the subsidiaries, associates and joint venture companies as per the Companies Act, 2013 is provided at Annexure - A to the Consolidated Financial Statement and hence not reproduced here for the sake of brevity.

***Vadodara Jal Sanchay Private Limited was incorporated on 22/07/2020 as a joint venture company by Gujarat State Fertilizers & Chemicals Limited, Gujarat Alkalies and Chemicals Limited, Gujarat Industries Power Company Limited and Vadodara Municipal Corporation with investment in the ratio of 60:15:15:10 respectively. A report on the performance and financial position of each of the subsidiaries, associates and joint venture companies as per the Companies Act, 2013 is provided at Annexure - A to the Consolidated Financial Statement and hence not reproduced here for the sake of brevity.

8. Listing of Shares & Depositories:

The Equity Shares of your Company are listed on the BSE Limited (BSE) and National Stock Exchange of India Ltd. (NSE). As approved by the shareholders Equity Shares have been delisted from Calcutta Stock Exchange Association Ltd., Kolkata. The listing fee for the FY 23-24 has been paid timely to both the BSE and NSE.

Your Directors wish to state that the Equity Shares of your Company are compulsorily traded in dematerialized form w.e.f. 26/06/2000. Presently, 98.30% of shares are held in electronic/ dematerialized form.

9. Report on Corporate Governance And Management Discussion And Analysis Report To Shareholders:

Your Company has complied with all the mandatory requirements of Corporate Governance norms as mandated by SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.

A separate report on Corporate Governance together with the Certificate of M/s. Samdani Kabra & Associates, Company Secretaries, Vadodara forms part of this Annual Report. The Management Discussion & Analysis report also forms part of this Annual Report.

10. Business Responsibility and Sustainability Report:

Business Responsibility and Sustainability Report forms part of this Annual Report as required under Regulation 34(2) (f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

11. Fixed Deposits

During the year 2022-23, your Company has not accepted/ renewed any Fixed Deposit. Your Directors wish to report that there are NIL Fixed Deposits aggregating ' NIL which have remained unclaimed by Depositors, as on 31^st March, 2023. Letters reminding them to seek repayment have been sent. Upto and including the date of this report, Nil deposits have been repaid.

During the year, the Company has transferred nil amount to unclaimed deposits and interest amount thereon to the Investors' Education and Protection Fund (IEPF) as required in terms of Section 125 of the Companies Act, 2013. The Company has discontinued accepting new deposits since 15.11.2005, and renewing the deposits since 31.03.2009.

12. Insurance:

All the properties and insurable interests of the Company, including the buildings, plant & machinery and stocks have been adequately insured. Also, as required under the Public Liability Insurance Act, 1991, your Company has taken the appropriate insurance cover.

13. Expansion & Diversification

Your Directors are happy to share the status of various projects that are under execution/executed as below: 100 MTPD Gypsum Granulation Plant:-

Considering increased use of Gypsum granules as a soil conditioner and the cost advantage over Gypsum powder, your company has successfully commissioned 100 MTPD Gypsum Granulation Plant at Vadodara unit on LSTK basis in November, 2022.

400 MTPD Ammonium Sulphate Plant at Vadodara Unit:-

To capture growing market of Ammonium Sulphate, your company is setting up 400 MTPD Ammonium Sulphate Plant at Vadodara Unit. Based on experience of Ammonium Sulphate production over the years, your company will execute the Project without involving technology supplier and by utilising In-house expertise and available resources. The Project is under execution stage and expected Commissioning date is December, 2023.

20 MTPD HX Crystal Project-

Considering present demand-supply gap and as an import substitute, your company is expanding production capacity of HX crystals plant at Vadodara unit for further value addition. Your company will execute the Project based on In-house technology and by utilising available resources.

Relocation of 07 nos. Wind mills to facilitate operation of Rajkot International Airport:-

To facilitate the operation of Rajkot International Airport, your Company is relocating 07 nos. of wind mills from Mahidad, Rajkot site by engaging M/s Suzlon as LSTK Contractor. Project is under execution stage and expected dated of commissioning of these wind mills at new location is December, 2023.

15 MW Solar Power Project at Charanka:-

To make use of green energy & meet Renewable Purchase Obligation (RPO) requirement, your company is setting up 15 MW ground mounted solar power plant at Charanka, Gujarat. Your company has awarded the work to EPC contractor and Project activities are under progress.

Urea Plant Revamping Project:-

To reduce the energy consumption of existing Urea Plants and improve the plant reliability considering vintage plant, your company is carrying out revamping of Urea-II Plant. M/s Casale SA, Switzerland is selected as Technology supplier while M/s Larson & Toubro Limited is selected as EPC contractor. The Project is under execution stage and expected Commissioning date is February, 2025.

600 MTPD Sulphuric Acid Plant at Vadodara Unit:-

Based on Sulphuric Acid & Steam balance of the complex, your Company is setting up 600 MTPD Sulphuric Acid Plant on LSTK basis at Vadodara Unit. M/s ISGEC Heavy Engineering Limited is selected as LSTK Contractor with M/s DMCC technology. The Project is under execution stage and expected Commissioning date is November, 2024.

600 MTPD Phosphoric Acid Plant and 1800 MTPD Sulphuric Acid Plant at Sikka Unit:-

As a part of backward integration, your Company is considering to install 600 MTPD Phosphoric Acid Plant and 1800 MTPD Sulphuric Acid Plant at Sikka Unit. M/s TECI, Tunisia is selected as Technology supplier for Phosphoric Acid Plant while M/s Chemetics, Canada is selected as Technology supplier for Sulphuric Acid Plant. Basic Engineering activities are under progress by technology suppliers.

Roof top Solar Power Project at Vadodara and Sikka Unit:-

To enhance green energy portfolio, your Company is considering to set up roof top solar plant at Vadodara Unit and floating roof & roof top solar plant at Sikka unit on EPC basis. Company has received commercial offers from EPC contractors and same are under evaluation.

Green Hydrogen Project at Vadodara Unit:-

As a part of green initiative of Government of India, your company is evaluating setting up of a Green Hydrogen Project at Vadodara Unit on LSTK basis.Company has received technical offers from LSTK contractors which are under evaluation.

40,000 MTPA Melamine-IV Project at Vadodara Unit:-

After successful commissioning and operation of 40,000 MTPA Melamine-III Project at Vadodara Unit, your Company is considering to set up 40,000 MTPA Melamine-IV Project at existing location of Melamine-I Plant at Vadodara unit. Company has received technical offer from technology supplier and same is under evaluation.

Revival of Polymer Unit (PU):-

Company is in process of identifying Projects for growth which may be undertaken on standalone basis or under a JV. In order to assess the potential of the shortlisted products, company is in process of carrying out Market Survey.

Revival of Fiber Unit (FU):-

Company has identified various options for revival of Fiber Unit and same are under evaluation.

Development of Dahej Complex: -

Company has prepared a business plan for development of Dahej Complex by engaging consultant. Company is in process of carrying out Detailed Project report for the identified products in business plan.

14. Information regarding conservation of energy, technology absorption, foreign exchange earnings and outgo and particulars of employees etc.

Information as required under Section 134 (3) (m) of Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are enclosed in Annexure “C” forming part of this report.

The details relating to Section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 have been disclosed in point # 5 of Corporate Governance Report.

15. Corporate Social Responsibility (CSR)

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. As a part of its initiatives under “Corporate Social Responsibility”, the Company

has undertaken projects in the areas of education, livelihood, health, water and sanitation. The Annual Report on CSR activities is enclosed as Annexure A. CSR Policy adopted by the Company is placed on the Company's website at https://www.gsfclimited.com/social_commitment.asp?mnuid=1&fid=15

16. Directors

A) Changes in Directors and Key Managerial Personnel:

Shri Raj Kumar, IAS has been appointed as Chairman w. e. f. 21.02.2023 in place of Shri Pankaj Kumar, IAS (till 01.02.2023).

Shri J. P. Gupta, IAS shall be liable to retire by rotation at the ensuing Annual General meeting and has offered himself for re-appointment.

Government of Gujarat had nominated Shri Mukesh Puri as Managing Director of the Company effective from 06/12/2020. As per the Government of Gujarat Order dated 05/12/2020, he was the Additional Chief Secretary, Urban Development & Urban Housing Department, Government of Gujarat and was holding additional charge as Managing Director - GSFC Limited for the period effective from 06/12/2020.

Accordingly the members at 60^th Annual General Meeting approved the appointment of Shri Mukesh Puri, IAS as Managing Director of the Company. The members at the said 60^th AGM further authorized the Board of Directors to approve the remuneration, perquisites or terms and conditions for his appointment, as per the communication that may be received from the Government from time to time.

Thereafter, Shri Mukesh Puri, IAS was relieved from the charge as Additional Chief Secretary, Urban Development & Urban Housing Department and his services were placed by the Government to hold full time charge as Managing Director - GSFC Limited vide GoG Notification dated 24/12/2021. Hence, he was appointed as Managing Director in the category of Executive Director with effect from 24/12/2021.

Government of Gujarat, vide its resolution # GSF/1098/1620/ E dated 20/01/2022 advised the terms and conditions for his appointment holding full time charge as Managing Director - GSFC Limited during his tenure for holding full charge as Managing Director - GSFC Limited.

The terms and conditions issued by the Government of Gujarat for the period of his appointment in the category of Executive Director was approved by the shareholders at 60^th Annual General Meeting for a period from 24/12/2021 to 03/03/2022.

Thereafter, vide GoG Notification dated 03/03/2022; he was again given charge as Additional Chief Secretary to Agriculture, Farmers Welfare and Co-operation Department, Government of Gujarat and was appointed to hold the additional charge as Managing Director - GSFC Limited. Hence, the category again was changed from executive director to non-executive director.

Further, vide GoG Notification dated 31/03/2023, he was transferred from Agriculture, Farmers Welfare and Co-operation Department, Government of Gujarat and was appointed as Additional Chief Secretary to Home Department, Government of Gujarat and continued to hold the additional charge as Managing Director -GSFC Limited

Smt. Mamta Verma, IAS has been appointed w.e.f.01.07.2021as a rotational director in place of Smt. Sunaina Tomer, IAS (till 14.06.2021) and Shri J. P. Gupta, IAS has been appointed w.e.f. 14.12.2021 as rotational director in place of Shri Pankaj Joshi, IAS, (till 01.11.2021).

Shri Tapan Ray, Smt. Gauri Kumar, Prof. Ravindra Dholakia and Dr. Sudhir Kumar Jain, independent directors have submitted declarations that they meet the criteria of Independence as provided under section 149 (6) of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, the names of all the Independent Directors of the Company have been included in the data bank maintained by the Indian Institute of Corporate Affairs.

The brief resume of Directors with regard to appointment/ re-appointment at 61^st Annual General Meeting is annexed to the Notice convening the 61^stAnnual General Meeting, which forms the integral part of this Annual Report.

Shri Vishvesh Vachhrajani, Company Secretary & Compliance Officer of the Company has tendered his resignation w.e.f. 10/02/2023 and hence ceases to be the Key Managerial Personnel of the Company. Smt.

Nidhi Pillai has been appointed as Company Secretary & Compliance Officer as well as Key Managerial Personnel of the Company.

A Certificate has been obtained from the Company Secretary in practice, confirming that none of the directors on the Board of Directors of the Company have been debarred or disqualified from being appointed or continuing as director of Companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any such other statutory authorities. The Certificate of Shri Niraj Trivedi forms part of this report.

B) Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligation & Disclosure Requirement) Regulations, 2015, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation has been carried out is explained in the Corporate Governance Report which forms the part of this Annual Report.

C) Appointment and Remuneration Policy:

The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, senior management and their remuneration. The details of Remuneration Policy and its web link are contained in the Corporate Governance Report.

D) Meetings:

During the year, six Meetings of the Board of Directors and five meetings of the Audit Committee were held. The composition of Board and Committees along with details of attendance is contained in Corporate Governance Report.

Dividend Distribution Policy: The Board of Directors of the Company at its Meeting held on 26th May, 2017 has adopted “Dividend Distribution Policy” effective from 26th May, 2017, which is available on the Company's Website at the link https://www.gsfclimited.com/companys-act-listing-agreement.

As per the SEBI Listing Regulations, the said “Dividend Distribution Policy” is also required to be disclosed in the Annual Report of the Company, which is annexed herewith as Annexure - D.

17. Details of establishment of vigil mechanism for Directors and Employees:

The Company has a Vigil Mechanism Policy in place to deal with instances, if any, of the fraud, mismanagement, misappropriations, if any and the same is placed on the Company's website. The details of the policy as well as its web link are contained in the Corporate Governance Report.

Reporting of fraud by Auditors

During the year under review, the Statutory Auditors of the Company have not reported any instance of fraud to the Board of Directors under Section 143 (12) of the Companies Act, 2013, including rules made thereunder.

Disclosure as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (as amended from time to time).

Secretarial Standards of ICSI

Your Company is in compliance with the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India and approved by the Central Government.

18. Particulars of loans, guarantees or investments under section 186:

Particulars of loans given, investments made, guarantee given and securities provided (if any) along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement.

19. Particulars of contracts or arrangements with related parties:

All Related party transactions were placed before the Audit Committee and also the Board of Directors for approval. Prior omnibus approval of the Audit Committee is obtained and a statement giving details of transactions, if any, shall be continued to be placed before the Audit Committee meeting as mandated. The Company has developed a mechanism for identification of related party transactions and the Company is also having the system of monitoring of such transactions.

During the Financial Year, the transactions entered into by the Company with Related Parties were in the ordinary course of business at arm's length price and/or within the omnibus approval granted by the Audit Committee.

The Company has not entered into contracts / arrangements / transactions with Related Parties which could be considered material in accordance with Section 188 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 and the Policy of the Company on Related Party T ransactions. Since, all the contracts / arrangements / transactions with Related Parties during the year were in the ordinary course of business and/or the same were at arm's length as well as under the special omnibus approval route and not being material transaction as defined under the Act / Rules, disclosure in Form AOC-2 under Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not required.

20. Managerial Remuneration:

Details as required pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are contained in Corporate Governance Report.

21. Risk management policy:

The details of such Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report.

22. Directors' Responsibility Statement:

Pursuant to Section 134 (3) (c) of the Companies Act, 2013, your Directors confirm that:

a. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. The Directors had prepared the annual accounts on a going concern basis;

e. The Directors, in the case of a listed Company, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

23. Auditors:

(a) Statutory Auditors

On the recommendation of Audit Committee, the Board of Directors has recommended for the appointment of M/s. Parkih Mehta & Associates, Vadodara, Chartered Accountants (Firm Registration No. 112832W) as the Statutory Auditors for the first term of two consecutive years i.e. to hold the office from the conclusion of 60^th Annual General Meeting till the conclusion of 62^nd Annual General Meeting of the Company to be held in the year 2024.

(b) Cost Auditors:

In terms of the Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost accounting records and get them audited every year.

The Board of Directors of your Company, on the recommendations made by the Audit Committee, has approved appointment of M/s Diwanji & Company, Cost Accountants, Vadodara (Firm Registration Number 000339) as the Cost Auditors of your Company to conduct the audit of cost records for the Financial Year 2023-24. The remuneration proposed to be paid to the Cost Auditor is placed for your ratification at the ensuing 61^st Annual General Meeting. The Cost Audit report for the F.Y. 2022-23 was filed within stipulated time.

(c) Internal Auditors:

Your Company has appointed M/s K C Mehta & Co, Chartered Accountants, Vadodara, as Internal Auditors of Baroda & Sikka Unit for Financial Year i.e. 2023-24.

(d) Secretarial Auditors & Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Niraj Trivedi, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor is enclosed as Annexure B.

24. Auditors' Report:

There are no comments/ observations, reservations or adverse remarks in the Auditors Report and Secretarial Audit Report and hence no clarifications need to be given on the clean report.

25. Annual Return:

The Annual Return of 2021-22 in prescribed Form No. MGT-7, as required under Section 92(1) of the Companies Act, 2013 read with Rule 11 of the Companies (Management and Administration) Rules, 2014 was filed and is placed on the Company's Website at https://www.gsfclimited.com/companys-act-listing-agreement.

The same was filed with the Registrar of Companies, Gujarat (ROC) on Ministry of Corporate Affairs (MCA) portal within prescribed time limit.

26. Human Resources:

Your Directors are happy to acknowledge that the well positioned human resource of the Company have been key drivers in implementing ideas, polices, cultural and behavioral aspects of the organization and ultimately with their outstanding performance has helped the Company to realize its objectives. Your Directors are happy to place on record their appreciation for highly potential, consistent and ethical employees for their remarkable contribution to the Company.Industrial Relations have remained cordial during the period under report.

27. Acknowledgements:

Your Directors place on record their appreciation for the overwhelming co-operation and assistance received from the Government of Gujarat, Government of India, Bank of Baroda and other Banks and agencies. Your Directors also wish to express their gratitude to the investors for their continued support and faith reposed in the Company.

For and on behalf of the Board Sd/-

Place : Fertilizernagar Raj Kumar, IAS

Date : 22^nd August, 2023 Chairman

(DIN: 00294527)